Today Mary Kay Cosmetics announced the closing of its operations in India. The decision appears to made on the basis of the regulatory environment and the poor performance of the market. In December, a ban was proposed on multi-level marketing in India.
This announcement comes after Mary Kay Inc. invested $20 million into growing the market between 2007 and 2012.
This closure is good for women in India. But Mary Kay is still doing well overseas. China is still growing rapidly, and sometime in 2013, it will become Mary Kay’s largest market.
Read the announcement below:
A Message from Darrell Overcash
Dear Independent Sales Director,
After extensive thought and discussion, I wanted to make you aware that we have made the difficult decision to close Mary Kay India. The decision to close our operations in India comes after great consideration and an extensive evaluation of market performance and future potential for long-term sustainable growth.
We have seen the regulatory environment in India for both direct selling and cosmetics companies dramatically change and change again at an alarming and inconsistent rate, while the country’s infrastructure continues to create insurmountable obstacles.
Despite significant investments of time and money, our operation in India has not performed as we had hoped and expected. So, we have made the decision to reallocate the Company’s resources to other international markets.
We are aware that this decision will be disappointing and painful for our employees and their families, the independent sales force and to our customers in India. Every day we are in business, we have to make tough decisions based on the long-term health of our Company and what’s best for you and the more than 2.5 million independent beauty consultants in the more than 35 markets where we operate around the world.
It’s important for you to know that we have no plans to close other markets. In fact, the Company plans and expects to continue growing internationally and we continue to grow here in the United States. Mary Kay is entering 2013 with tremendous momentum, having set Company sales records globally the last three years with November 2012 as the highest sales month in Company history.
Rest assured the Company’s priority remains the same — to ensure that the Mary Kay opportunity makes a positive difference in women’s lives, helping them reach their full potential. We plan on continuing that mission globally, with your help.
President, Mary Kay U.S.